TORONTO, Aug. 29 /CNW/ - Strong revenue growth driven by higher asset
volumes across Scotiabank's three business lines, due in part to several recent strategic acquisitions, led to record earnings in the third quarter of 2006.

Scotiabank reported earnings per share (diluted) of $0.93 for the quarter, up a strong 21% from $0.77 for the same period last year. Net income rose to $936 million in the third quarter, an increase of 19% over last year.

"The quarter reflected strong growth in sustainable revenue - one of our key strategic priorities," said Rick Waugh, President and CEO. "All three business lines - Domestic Banking, Scotia Capital and International Banking - contributed to this quarter's record results, including recent acquisitions such as the mortgage business of Maple Financial Group and the purchase of two banks in Peru. Highlighting our success was a 16% increase in total assets over the first nine months of the year, representing broad-based growth in retail, commercial and corporate portfolios. In addition, both International and Scotia Capital continue to demonstrate their ability to earn through the negative impact of foreign currency translation.

"International Banking experienced strong underlying growth across its businesses, led by Mexico, which saw significant increases in both retail and
commercial lending. The Caribbean showed a steady rise in both retail and
commercial loan volumes and there were solid contributions from Peru and other recent acquisitions. International Banking also recorded a recovery in value added tax of $51 million, or $0.05 per share.

"We experienced significant growth in retail and commercial lending in
Domestic Banking. This growth, along with higher transaction-based revenue,
led to another solid contribution from this business line.

"Scotia Capital's results were highlighted by continued growth in its loan portfolio and benefited from loan loss and interest recoveries and securities gains, which more than offset a drop in trading revenues. "The Bank's capital position remains strong, providing us with the opportunity to continue to pursue further growth options across product lines and geographies and increase returns for shareholders."

Net income for the nine-month period ending July 31, 2006, was $2,682 million, compared to $2,398 million for the same period last year. "With our record results for the nine months, we expect to achieve the upper range of our key performance objectives this year," Mr. Waugh said.